Jeffrey D. Sadow is an associate professor of political science at Louisiana State University Shreveport. If you're an elected official, political operative or anyone else upset at his views, don't go bothering LSUS or LSU System officials about that because these are his own views solely.
This publishes Sunday through Thursday with the exception of 7 holidays. Also check out his Louisiana Legislature Log especially during legislative sessions (in "Louisiana Politics Blog Roll" below).

Search This Blog

2.10.12

Issues emerge from forum to help voters decide PSC race

Candidates for the open District 2 seat of the Louisiana Public Service Commission participated
in a forum where interesting questions arose about the operation of and service
on the PSC, also shedding light on a court case dealing with financing the
body, all of which help the public evaluate the PSC and its current or potential members.

One question concerned whether candidates for the office should accept
contributions for campaigning from utility companies, one of the kinds of firms
whose activities may be regulated by the PSC. The fronturnners called this
acceptable and said they had already taken such funds, while the also-rans,
none of whom to date have filed a campaign finance report implying they have
raised little money, said candidates should abjure from taking them.

But the problem with the latter approach is it unfairly restricts the
free speech rights of shareholders of those companies, while their special
interest opponents would face no barrier. And why single out utility companies
when others, like motor carriers, regulated by the PSC would face no ban? If a candidate
out of personal preference declines such funds, that’s his business, but mandating
that stricture puts the state in the position of tipping the scales against a
certain industry, as it already does in similar restrictions against gaming
concerns.

Another question solicited views on what to do with excess funds the
PSC may have collected that otherwise may sit idly by. The body does not have
its own revenue-raising capacity but instead must accept legislative
appropriation, with the bulk of that coming from the Utility and Carrier
Inspection and Supervision Fund, along with two other much smaller dedicated
funding sources. What frequently occurs is the amounts collected every year
surpass the appropriated amounts, therefore causing fund balances to build up.
For example, at the end of the 2011
fiscal year, this fund had collected a surplus of $543,000, giving it an
idle balance of $2,543,000, of which $2,000,000 was moved out for other purposes.

The PSC doesn’t like the idea of legislators tapping into this
dedicated fund to operate other parts of government, which for the upcoming
fiscal year the Legislature assumed would run $765,050
over and thus liberated that for other government expenses, and over
previous years’ grabbing of what is termed this “one-time money” sued,
so far unsuccessfully, the Legislature. These transfers out now exceed over
$10 million in the past four years, demonstrating that the funds take in way
more money than the Legislature thinks the PSC needs to do its job.

When asked about the use of these funds, candidate answers varied. One
view, shared by two, was to return the money to ratepayers, as is done in other
states. Another approved of the general idea that any excess funds ought to be
kept on hand for statewide use, questioning whether the PSC retained sufficient
accountability to oversee them for its own use. Still another split hairs,
saying the funds that collect fines should have excess go into the general fund
but fees should stay with the PSC, with the logic apparently being the somewhat
predictable stream of fee funds stay under PSC control but the fine amounts collected,
which could vary considerably by enforcement tactics, presented a temptation to
turn enforcement into a revenue-raising plan that would be abated by not
allowing the excess to be retained.

The only questionable argument made on this account came from Forrest
Wright, who bizarrely declared that taking something originally collected as a
fee-for-service magically transformed into a tax once swept from one account to
another. He seemed oblivious to the absurdity behind the claim: an idle dollar
justifies higher-than-needed fees, but to use it turns it into a tax? A “tax”
is something collected that bears no relationship to a service provided in
exchange, but clearly here there is an exchange (even as it could be claimed
that, for excess funds, there is no relationship of their collection to the
service). Indeed, this reasoning argues that the PSC should spend every penny,
whether justified, in order to make legitimate higher-than-needed fees. This is
backwards: if excesses get run, either the fees need lowering or rebates should
get offered, if the excess is not to be swept to other needed uses elsewhere in
state government.

The
PSC receives probably the least attention of all elected state offices. It’s
good that issues such as these are getting aired in this camapign, and the
discourse would become really valuable if things such as deregulation
of electric power become subjects of this debate.

About Me

Subscribe To

Comment publishing requirements

You must be a registered user with an OpenID-compliant service to leave comments, which will be moderated. Any comments that do not address issues in the post for which they are intended will not be posted; neither will those that utterly lack intellectual coherence.